Studies of human neuropathology have implicated the limbic system in mediation of the processes of learning and memory. In accord with this finding, our own studies of unit activity in behaving animals have led to a theoretical model in which it is posited that cortex, the anteroventral (AV) thalamus and the hippocampal formation function interactively to perform encoding and extraction of the associative significance of cues (e.g., conditional stimuli) in discriminative learning situations. The code for significance is critical for the subject's ability to predicate behavior on cue-occurrence. The model states that the deep laminae of cingulate cortex are the sites of the initial-most encoding at the outset of training. However, with continuing training the code for significance is relegated to neurons of the AV thalamus, by virtue of repeated discriminative neuronal inputs to the AV thalamus from the deep laminae. Once relegation of the code to thalamus has occurred, the operation of the code for coninuing task performance, and any recoding that is called for (e.g., reversal), are carried out at the level of the AV thalamus. Inputs to the AV thalamus from the hippocampal formation (subiculum) are essential in bringing about relegation of the code to the AV thalamus and reformulation of the AV thalamic code, as in reversal. A major objective is to complete five experiments each involving neuronal recording during discriminative acquisition, retention and reversal, in conjunction with focalized brain damage induced either before training or after training but prior to reversal. In each case a specific prediction of the model about neuronal activity, and about behavior, will be tested. Preliminary findings from the first of these experiments (p. 22 and Appendix P) are fundamentally in accord with the model's predictions and they indicate the usefulness of combining the lesioning and recording techniques. Additional goals include: (a) extension of our CNS map of the neuronal correlates of conditioning and (b) identification of the neural substrates of the blocking action of neuroleptic drugs on avoidance behavior.